Verizon FiOS speed drops in Netflix ISP index, despite peering deal

What's the deal, Verizon (NYSE: VZ)? Most observers--and Netflix (NASDAQ: NFLX), surely--expected that the SVOD provider's streaming performance over Verizon's FiOS network would improve, now that Netflix is paying Verizon for preferred bandwidth. But the carrier's average streaming speeds instead dropped two places in Netflix's monthly speed index.

Verizon FiOS fell two places, to tenth, in Netflix's May ISP Speed Index, with an average streaming speed of 1.90 Mbps. Verizon's DSL service landed in last place, sixteenth, with an average speed of 1.05 Mbps, bumping up perennial laggard Clearwire (now owned by Sprint) to fifteenth place.

Cablevision's (NYSE: CVC) Optimum service landed in the top spot once again with an average streaming speed of 3.3 Mbps, which is .3 Mbps faster than last month's average. Cox remained in the No. 2 spot, but Charter (NASDAQ: CHTR) jumped past Suddenlink and Comcast (NASDAQ: CMCSA) to take third place in the rankings, with average Netflix streaming speeds of 2.87 Mbps.

Netflix ranks the major Internet service providers by averaging the speed at which its movies and TV shows are streamed to subscribers in those providers' networks. The rankings don't reflect ISPs' peak performance rates.

After agreeing in April to pay Verizon an undisclosed amount in return for getting preferred bandwidth over its network, Netflix has apparently failed to see any improvement in streaming speeds. By contrast, average speeds skyrocketed on Comcast's network when Netflix, after two years of beefing with the MSO over alleged throttling of its bandwidth, agreed to pay for improved access. Comcast jumped from 11th place to third place, with an average speed of 2.77 Mbps, in April.

Additionally, Netflix says it plans to continue, and expand, its "transparency campaign"--an initiative in which subscribers who experience buffering of a Netflix video stream receive a message on their screens that their provider's network may be the cause of their video playback trouble. The campaign started a minor tempest last week when a Verizon FiOS customer posted a screenshot of Netflix's message appearing on a PC screen.

"(W)e started a small scale test in early May that lets consumers know, while they're watching Netflix, that their experience is degraded due to a lack of capacity into their broadband provider's network," wrote Joris Evers, VP and head of communications for Netflix's Europe operations, in a corporate blog post. "We are testing this across the U.S. wherever there is significant and persistent network congestion. This test is scheduled to end on June 16. We will evaluate rolling it out more broadly."

While The Verge surmised that Netflix was actually scaling back its buffering message offensive in response to a cease-and-desist letter the SVOD provider received from Verizon last week, it's clear from the above statement that the company doesn't want to completely abandon the idea.

Netflix also continued its war of words over last-mile interconnection speeds in the post, albeit without naming Verizon or any other provider directly.

"We pay some of the world's largest transit networks to deliver Netflix video right to the front door of an ISP. Where the problem occurs is at that door--the interconnection point--when the broadband provider hasn't provided enough capacity to accommodate the traffic their customer requested."

But Netflix's complaints may soon be moot. Google (NASDAQ: GOOG) recently launched its own ISP ranking report, which allows users to learn the average YouTube download speeds of providers in their area.

Trumping that, a Sandvine corporate post criticized both providers' rankings, saying that they are filled with conflicts and inaccuracies.

Sandvine disputed Canadian ISP Rogers Communications' low ranking on the Speed Index, pointing out that independent monitoring company SamKnows found Rogers' broadband performance was in excess of 100 percent of its advertised speeds. It also argued that since both Google and Netflix rate only their own applications' performance, their results are flawed.

Netflix may speed index

For more:
- see the Netflix blog
- TheVerge has this story
- DSL Reports has this story
- see this Sandvine blog post

Related articles:
Comcast hits No. 3 spot in Netflix rankings, but Canadian ISPs trump U.S. speeds
Netflix investors look to strip Hastings of chairmanship
Verizon ramps up Netflix tiff with cease and desist letter
Verizon calls Netflix customer ISP messages 'misleading PR stunt'

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